New captive legislation is to set Tennessee apart from other US captive insurance domiciles, according to the state’s Department of Commerce and Insurance (TDCI).
The department suggested that with “an eye toward increasingly balanced regulation, the TDCI is ushering in new, more modern rules to guide” the state’s captive insurance industry.
The new rules, effective 21 December, will allow individual protected cells to go dormant and later to be restarted.
In addition, new captives and cell companies will no longer be required to be audited if they were formed in the last quarter of the year, representing cost-savings for the captives and cell companies.
Finally, a full financial exam will not be required where specific limited questions have arisen about the operation of a captive company.
Julie Mix McPeak, TDCI commissioner, said: “These rule changes represent six years’ of lessons learned in licensing and regulating captive insurance companies and again demonstrate Tennessee’s commitment to growing an important economic component.”
Tennessee’s captive insurance sector has generated an economic impact of over $692 million during 2016.
